CLS gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 123 industry peers in the Electronic Equipment, Instruments & Components industry. CLS scores excellent on profitability, but there are some minor concerns on its financial health. CLS is quite expensive at the moment. It does show a decent growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year CLS was profitable.
CLS had a positive operating cash flow in the past year.
Of the past 5 years CLS 4 years were profitable.
Of the past 5 years CLS 4 years had a positive operating cash flow.

1.2 Ratios

CLS has a Return On Assets of 10.85%. This is amongst the best in the industry. CLS outperforms 91.87% of its industry peers.
CLS's Return On Equity of 35.33% is amongst the best of the industry. CLS outperforms 95.94% of its industry peers.
CLS has a better Return On Invested Capital (21.33%) than 96.75% of its industry peers.
CLS had an Average Return On Invested Capital over the past 3 years of 11.43%. This is above the industry average of 8.87%.
The 3 year average ROIC (11.43%) for CLS is below the current ROIC(21.33%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	10.85%
ROE	35.33%
ROIC	21.33%

ROA(3y)4.63%

ROA(5y)3.55%

ROE(3y)15.02%

ROE(5y)11.3%

ROIC(3y)11.43%

ROIC(5y)8.93%

1.3 Margins

With a decent Profit Margin value of 6.35%, CLS is doing good in the industry, outperforming 72.36% of the companies in the same industry.
In the last couple of years the Profit Margin of CLS has grown nicely.
CLS has a Operating Margin of 7.33%. This is in the better half of the industry: CLS outperforms 71.54% of its industry peers.
CLS's Operating Margin has improved in the last couple of years.
CLS's Gross Margin of 12.04% is on the low side compared to the rest of the industry. CLS is outperformed by 76.42% of its industry peers.
In the last couple of years the Gross Margin of CLS has grown nicely.

		Industry Rank	Sector Rank
OM	7.33%
PM (TTM)	6.35%
GM	12.04%

OM growth 3Y24.27%

OM growth 5Y29.03%

PM growth 3Y34%

PM growth 5Y30.13%

GM growth 3Y8.03%

GM growth 5Y10.39%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CLS is creating value.
There is no outstanding debt for CLS. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.

2.2 Solvency

CLS has an Altman-Z score of 7.65. This indicates that CLS is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 7.65, CLS belongs to the best of the industry, outperforming 82.11% of the companies in the same industry.
CLS has a debt to FCF ratio of 1.97. This is a very positive value and a sign of high solvency as it would only need 1.97 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.97, CLS is in the better half of the industry, outperforming 78.86% of the companies in the same industry.
CLS has a Debt/Equity ratio of 0.37. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.37, CLS is in line with its industry, outperforming 40.65% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	0.37
Debt/FCF	1.97
Altman-Z	7.65

ROIC/WACC2.67

WACC7.99%

2.3 Liquidity

CLS has a Current Ratio of 1.47. This is a normal value and indicates that CLS is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.47, CLS is doing worse than 75.61% of the companies in the same industry.
A Quick Ratio of 0.88 indicates that CLS may have some problems paying its short term obligations.
With a Quick ratio value of 0.88, CLS is not doing good in the industry: 85.37% of the companies in the same industry are doing better.
The current and quick ratio evaluation for CLS is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

		Industry Rank	Sector Rank
Current Ratio	1.47
Quick Ratio	0.88

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

CLS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 54.59%, which is quite impressive.
CLS shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 43.67% yearly.

EPS 1Y (TTM)54.59%

EPS 3Y46.94%

EPS 5Y43.67%

EPS Q2Q%70.27%

Revenue 1Y (TTM)N/A

Revenue growth 3YN/A

Revenue growth 5YN/A

Sales Q2Q%43.57%

3.2 Future

The Earnings Per Share is expected to grow by 33.06% on average over the next years. This is a very strong growth
CLS is expected to show a strong growth in Revenue. In the coming years, the Revenue will grow by 28.15% yearly.

EPS Next Y38.59%

EPS Next 2Y37.93%

EPS Next 3Y33.06%

EPS Next 5YN/A

Revenue Next Year32.94%

Revenue Next 2Y32.93%

Revenue Next 3Y28.15%

Revenue Next 5YN/A

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 56.97 indicates a quite expensive valuation of CLS.
The rest of the industry has a similar Price/Earnings ratio as CLS.
CLS's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 28.60.
A Price/Forward Earnings ratio of 41.10 indicates a quite expensive valuation of CLS.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CLS is on the same level as its industry peers.
CLS is valuated expensively when we compare the Price/Forward Earnings ratio to 25.83, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	56.97
Fwd PE	41.1

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as CLS.
The rest of the industry has a similar Price/Free Cash Flow ratio as CLS.

		Industry Rank	Sector Rank
P/FCF	99.74
EV/EBITDA	40.62

4.3 Compensation for Growth

CLS's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of CLS may justify a higher PE ratio.
A more expensive valuation may be justified as CLS's earnings are expected to grow with 33.06% in the coming years.